Good morning. Here’s the news:1. The Wall Street Journal reports: “Insurgents staged a series of attacks with rocket-propelled grenades, suicide bombers and gunfire in the centre of the Afghan capital (Kabul) Tuesday near the U.S. and other Western embassies, witnesses and diplomats said.” The assault was the second major Taliban attack in the city in under a month.
2. US money market funds have apparently stopped lending to French banks, according to an op-ed piece in today’s Wall Street Journal. Shares in French banks have fallen sharply today.
3. The pressure on French banks (and European banks generally) keeps increasing. Credit “contraction” is pushing the Continent’s financial system toward seizure.
4. Italy is in dire straits. The FT reports: “Italy’s centre-right government is turning to cash-rich China in the hope that Beijing will help rescue it from financial crisis by making “significant” purchases of Italian bonds and investments in strategic companies.”
5. Greece is doomed. The FT reports: “The Greek economy is in a tailspin, bondholders are in revolt, and voters in Europe’s creditor countries are increasingly calling on their leaders to cut Athens loose. “There can be no more taboos,” Philipp Rösler, German economy minister, said at the weekend. “That includes, if necessary, an orderly bankruptcy of Greece.”
6. George Magnus of UBS argues that the present crisis is systemic: “Put simply, the economic model that drove the long boom from the 1980s to 2008, has broken down…..I would argue that the 2008/09 financial crisis has bequeathed a once-in-a-generation crisis of capitalism, the footprints of which can be found in widespread challenges to the political order, and not just in developed economies.”
7. Republican presidential candidates took aim at front-running Texas Governor Rick Perry in last night’s CNN/Tea Party debate in Tampa, Florida. They hammered him on Social Security, immigration and immunizations.
8. Matthew Dowd points out that Rick Perry’s stance on Social Security might actually be helping him politically amongst GOP primary voters and caucus attenders.
9. Gov. Perry’s performance at the CNN/Tea Party debate last night deteriorated as it moved along. John Podhoretz writes: “The main problem…is that he seems to think he can wing these debates by referring to what he did in Texas here and what he did in Texas there. That is…insufficient because it suggests he thinks he can get away without getting specific and demonstrating a command of national and international issues.”
10. President Obama said Monday that he plans to (mostly) fund his $447 billion jobs bill by raising taxes on wealthier families. Given that House Speaker Boehner has said, repeatedly, that deep spending cuts must precede any tax increases, the president’s proposal renders the American Jobs Act moot.
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